A tendered limit
When an insurer offers the full policy limit, the offer is low only in relation to the harm, not in relation to what litigation could produce. Suing that insurer for more is generally spending money to reach the same figure.
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Offer came in low? Five things to check before you decide to file suit
A low offer is a fact, not a verdict. Here are the five things worth checking, in order, before you decide whether filing suit actually improves the number.
Stacked coverage sources
Underinsured motorist coverage on your own auto policy, a commercial policy covering a driver on the job, and umbrella policies are the three places additional money usually hides. Each has its own notice requirements worth checking early.
Comparative fault math
Most states reduce recovery by the percentage of fault assigned to the injured person, so a thirty percent fault finding removes thirty percent of the award. An adjuster's low offer often reflects a fault split you have never formally contested.
Many contingency agreements raise the attorney's percentage once a complaint is filed, and again if the case reaches trial. Find that clause and read the exact triggering event before authorizing a filing.
An adjuster's first written offer is a position, not an appraisal, and the useful question is never whether it feels insulting but whether anything you can actually do would move it. Filing suit is the largest lever available, and it is also the one with the longest handle and the heaviest cost. Before deciding, a careful reader works through a short sequence of checks, in order, because the answer to the first one sometimes makes the rest of them irrelevant. Here is that sequence, drawn from a single claim file and the documents that governed it.
1. Find the deadline before you find the argument
The statute of limitations is the only item on this list that cannot be negotiated, extended by good faith, or fixed later with better evidence. It runs from a date set by state law, usually the date of the injury, sometimes the date you reasonably should have discovered it, and it varies by state and by defendant. A claim against a city or county often carries a separate, much shorter notice requirement that runs in months rather than years. Check the date first, write it somewhere you will see it, and treat every settlement discussion as a conversation happening inside that window rather than instead of it.
2. Read the declarations page, not the offer letter
Policy limits set the practical ceiling on what any amount of litigation can produce, and they are frequently lower than people assume. If the at-fault driver carries the state minimum and your medical bills already exceed it, the fight is not with the adjuster over valuation; it is a question of whether the limit gets tendered promptly and whether any other coverage exists. Underinsured motorist coverage on your own policy, an employer's commercial policy, an umbrella policy: these are the things worth hunting for. A tendered limit is a low offer that no lawsuit can improve, and recognizing one early saves a year.
3. Price the discount the other side is applying
Most low offers are not arbitrary. They reflect a specific discount for a specific weakness, and the weakness is usually comparative fault, a gap in treatment, or a preexisting condition that shows up in the records. Comparative fault reduces recovery by your assigned share, so an offer that looks like forty cents on the dollar may be a fair number multiplied by a fault split you have not yet contested. Ask the adjuster in writing which factor drove the number down. The answer tells you whether litigation would supply the missing proof or simply relitigate a fact the file already settles against you.
4. Add up what filing actually costs, in money and months
Filing changes the economics on both sides. Case costs move from postage and records fees into filing fees, service, court reporters, expert retainers and deposition transcripts, and those costs come off the top of any eventual recovery whether or not the number improves. Many contingency agreements also step the fee up once suit is filed, commonly from a third to something higher, so read that clause before you authorize the complaint. Time changes too. A claim that might resolve in months becomes one measured in a year or two, with discovery, motions, and a trial date that will probably move at least once.
5. Decide where the curve flattens
Litigation adds value up to the point where the remaining upside is smaller than the remaining cost plus the risk of losing. That point is identifiable. It usually arrives after the defense has taken your deposition and reviewed your medical records, because that is when the insurer finally prices the case on evidence rather than assumption. If the offer moves meaningfully then, the filing did its work. If it does not move, and no additional coverage exists, further spending buys mostly delay. Worth noting separately: the Internal Revenue Service is responsible for how settlement proceeds are treated for tax purposes, and the allocation in a settlement agreement matters more than the headline figure.
Run these five in order and the decision usually makes itself. A deadline that is close forces a filing regardless of the offer. A tendered limit forecloses one. Everything between those two poles is arithmetic you can do at a kitchen table with the fee agreement, the declarations page, and a printout of the medical bills in front of you.